Attunity Ltd.
ATTUNITY LTD (Form: 6-K/A, Received: 08/03/2016 16:49:47)


UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
FORM 6-K/A

REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16
OR 15d-16 UNDER THE SECURITIES EXCHANGE ACT OF 1934

For the month of August 2016

Commission file number: 001-20892
 
ATTUNITY LTD.
(Name of registrant)
 
16 Atir Yeda Street, Atir Yeda Industrial Park, Kfar Saba, 4464321, Israel
  (Address of principal executive office)
_____________________

        Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.  
 
Form 20-F S   Form 40-F £

        Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): £

        Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): £

____________________

The GAAP financial statements included in the press release attached hereto as Exhibit 99.1 are hereby incorporated by reference into: Form F-3 Registration Statements File Nos. 333-205799, 333-205798, 333-173205, 333-138044, 333-122937 and 333-119157 and Form S-8 Registration Statements File Nos. 333-122302, 333-142284, 333-164656, 333-184136 and 333-193783 .
 

Explanatory Note
 
On August 3, 2016, Attunity Ltd. (the “Company”), issued a correction to its original press release titled “Attunity Reports Second Quarter 2016 Results,” which was issued by the Company on August 3, 2016 (the "Original PR"). A copy of the corrected press release titled “CORRECTIION -  Attunity Reports Second Quarter 2016 Results” is furnished as Exhibit 99.1 herewith (the "Corrected PR").
 
The correction made in the Corrected PR was solely with respect to a typographical error in the third line of the table titled "Reconciliation of Supplemental Non-GAAP Financial Information" in the Original PR, where Non-GAAP revenues for the three months ended June 30, 2016 were inadvertently reported in the Original PR as $12,241 (U.S. dollars in thousands) rather than $14,241 (U.S. dollars in thousands), as was corrected in the Corrected PR.
 
CONTENTS
 
Exhibit
 
 99.1
 Press Release, August 3, 2016: CORRECTED : ATTUNITY REPORTS SECOND QUARTER 2016 RESULTS
 
 

 
SIGNATURES
 
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
 
 
ATTUNITY LTD.
 
 
By: /s/ Dror Harel-Elkayam
 
Dror Harel-Elkayam
Chief Financial Officer and Secretary

Date: August 3, 2016
 


 

 
Exhibit 99.1
 
/C O R R E C T I O N -- Attunity Ltd./
 
In the news release, Attunity Reports Second Quarter 2016 Results, issued Aug. 3, 2016 by Attunity Ltd. over PR Newswire, we are advised by the company that in the table 'RECONCILIATION OF SUPPLEMENTAL NON-GAAP FINANCIAL INFORMATION', Non-GAAP revenues for the three months ended June 30, 2016 should be $14,241. The complete, corrected release follows:
 
ATTUNITY REPORTS SECOND QUARTER 2016 RESULTS

Revenue grew to $14.2M, up 16% in the second quarter of 2016
- - -
 
Burlington, MA – August 3, 2016 – Attunity, Ltd. (NasdaqCM: ATTU) , a leading provider of Big Data management software solutions, today reported its unaudited financial results for the three-month period ended June 30, 2016.

“We are pleased with our continued revenue growth. Our success was driven by the growing demand in the Big Data market where customers are recognizing the advantages of our innovative product suite. These advantages enable us to address global enterprise initiatives that require large scale, heterogeneous and real-time data integration solutions for Hadoop data lakes. Our investments in sales and marketing enabled us to increase sales of Attunity Replicate, including another multi-million dollar, multi-year customer engagement for Hadoop, as well as to sign several new customers for our new Attunity Compose offering, launched earlier in the year,” said Shimon Alon, Chairman and CEO of Attunity. “With a growing pipeline of new licensing agreements, we expect our growth to continue through the second half of the year and beyond.”
 
Recent Operational Highlights
· Signed a $4.5 million, three-year agreement with a large global corporation for its enterprise data lake initiative, highlighting a growing market opportunity for Attunity with other large strategic and global agreements
· Successfully continued the launch of Attunity Compose, closing several agreements with new customers as well as existing Replicate customers
· Expanded collaboration with Microsoft to facilitate adoption of SQL Server 2016 and migration from other databases, such as Oracle
· Launched enhanced version of Attunity Visibility for Hadoop that enables intelligent data management for growing data lake environments
· Received several industry awards, including ‘50 Innovative Companies to Watch’ by the Silicon Review and ‘30 Coolest Data Management Vendors’ in Big Data 100 list by CRN

Financial Highlights for Q2 2016, compared with Q2 2015  
· GAAP total revenue increased 16% to $14.2 million
· Non-GAAP total revenue increased 14% to $14.2 million*
· GAAP operating expenses increased to $18.5 million compared with $12.9 million
o The operating expenses in Q2 2016 include an approximately $2.1 million charge for partial impairment of acquired technology associated with the Appfluent acquisition, as well as $2.0 million in expenses and amortization   associated with acquisitions and equity-based compensation expenses, compared with $1.8 million in expenses and amortization associated with acquisitions and equity-based compensation expenses for the same period in 2015
· Non-GAAP operating expenses increased to $14.4 million compared with $11.1 million *
· GAAP net loss of $2.9 million, compared with net loss of $0.8 million
· Non-GAAP net income of $0.1 million, compared with non-GAAP net income of $1.1 million *
· Generated positive cash flow from operations of $0.3 million

Big Data Management and Cloud Solutions

Attunity is increasingly recognized across the industry as a leading provider of Big Data management solutions, including its award-winning data integration and management offerings that provide data replication and ingest with real-time change data capture (CDC), data warehouse automation, data usage analytics, data connectivity, cloud data delivery, and test data management. In the second quarter of 2016, the Company’s solutions were recognized by a number of industry sources, including CIO magazine, CRN and Database Trends and Applications (DBTA) Magazine.

The Company made several product announcements during the second quarter of 2016, further expanding the capabilities of its existing solutions, as well as introducing new innovative solutions to the market.

Attunity expanded its collaboration with Microsoft Corp. to enable faster and easier adoption of Microsoft SQL Server 2016, the latest version of Microsoft’s market leading database and data warehousing platform running on-premises or on Microsoft Azure cloud, which became generally available in the second quarter of 2016. By utilizing Attunity Replicate’s high-performance data replication and CDC technologies, this cooperation is aimed at simplifying and accelerating zero-downtime migrations from systems like Oracle and other databases to SQL Server 2016.
 

 
The cloud continues to be an area of growth where enterprises are looking to migrate databases to cloud platforms, as well as leverage the cloud to analyze their data. These customer needs require an efficient and reliable way to move data from their data centers. We believe we are well positioned to accommodate this growing need with our innovative products as well as our alliances with leading global providers, such as Amazon Web Services, Microsoft and Google.

During the second quarter of 2016, the Company launched Attunity Visibility for Hadoop, which features enhanced technology that enables comprehensive data usage analytics for large-scale and fast-growing Hadoop data lake environments. This new and innovative solution is designed to provide a unified platform from which users are able to analyze usage across enterprise Big Data systems.

Demand for Attunity Compose, which was launched earlier this year, continued to build in the second quarter of 2016, with several deals completed and a growing pipeline of potential new deals.

Consulting Services

There continues to be an increased demand from customers requiring our consulting services for their larger scale and enterprise-wide implementations. Attunity continues to make investments in building out its consulting group as well as engaging system integration partners in order to address this demand.

Financial Results for Q2 2016
GAAP total revenue for the second quarter of 2016 increased 16% to $14.2 million, compared with $12.2 million for the same period in 2015. This includes license revenue of $8.0 million, which increased 17% compared with the same period in 2015 (the license revenue in the second quarter of 2016 includes $2.6 million from a $4.5 million, three-year strategic Hadoop deal signed during the quarter), and maintenance and service revenue, which grew 15% to $6.3 million, compared with $5.4 million for the same period in 2015.

Non-GAAP total revenue for the second quarter of 2016 increased 14% to $14.2 million, compared with $12.5 million for the same period in 2015. This includes non-GAAP maintenance and service revenue of $6.3 million, which grew 9% from the same period in 2015 (license revenue of $8.0 million was not used as a non-GAAP measure).*

GAAP operating expenses for the second quarter of 2016 increased 44% to $18.5 million, compared with $12.9 million for the second quarter of 2015. The increase in expenses is primarily related to the Company’s global expansion, with total headcount increasing by 40 people over the past year - including 30 additions to the sales, sales support, marketing and consulting services teams - to accommodate growing demand for Attunity Replicate and Compose. The increase in operating expenses in the second quarter of 2016 also includes a $2.1 million charge for partial impairment of acquired technology associated with the Appfluent acquisition.

Non-GAAP operating expenses for the second quarter of 2016 increased 30% to $14.4 million, compared with $11.1 million for the second quarter of 2015.*

GAAP operating loss for the second quarter of 2016 was $4.3 million, compared with $0.7 million for the same period in 2015.

Non-GAAP operating loss was $0.2 million for the second quarter of 2016, compared with operating income of $1.4 million for the second quarter of 2015. Non-GAAP operating loss for the second quarter of 2016 excludes a total of $4.1 million in expenses, including a $2.1 million charge for partial impairment of acquired technology associated with the Appfluent acquisition, and $2.0 million in expenses and amortization   associated with acquisitions and equity-based compensation expenses. This is compared with $2.1 million in adjustments, expenses and amortization associated with acquisitions and equity-based compensation expenses for the second quarter of 2015.*

GAAP net loss for the second quarter of 2016 was $2.9 million, or $0.17 per diluted share, compared with a net loss of $0.8 million, or $0.05 per diluted share, in the second quarter of 2015.

Non-GAAP net income for the second quarter of 2016 was $0.1 million, or $0.01 per diluted share, compared with non-GAAP net income of $1.1 million, or $0.06 per diluted share, for the same period in 2015. Non-GAAP net loss for the second quarter of 2016 excludes approximately $3.0 million in expenses, amortization and impairment charges associated with acquisitions, equity-based compensation expenses and tax benefits related to non-GAAP adjustments of $1.1 million, compared with approximately $1.9 million in adjustments, expenses and amortization associated with acquisitions, equity-based compensation expenses and tax benefits related to non-GAAP adjustments of $0.3 million for the same period in 2015.*


Cash and cash equivalents were $8.9 million as of June 30, 2016, compared with $10.0 million as of March 31, 2016. Cash and cash equivalents at the end of the second quarter of 2016 were mainly impacted by earn-out payment of $1.2 million to former Hayes shareholders.

Appfluent acquired technology, which was acquired in March 2015, decreased by $2.1 million to $2.6 million as of June 30, 2016, due to the partial impairment. This accounting charge was taken in order to reflect the fair value of the technology following delayed sales trends with longer sales cycles of Attunity Visibility, which we believe is primarily due to the innovative nature of this solution, aimed at optimizing enterprise data warehouses with Hadoop.

Shareholders' equity as of June 30, 2016 decreased to $34.5 million, compared with $36.4 million as of March 31, 2016.

 * See "Use of Non-GAAP Financial Information" below for more information regarding Attunity's use of Non-GAAP financial measures.

Conference Call and Webcast Information

The Company will host a conference call with the investment community on Wednesday, August 3 rd at 8:30 a.m. Eastern Time featuring remarks by Shimon Alon, Chairman and CEO of Attunity, and Dror Harel-Elkayam, CFO of Attunity. The dial-in numbers for the conference call are +1-888-576-4387 (U.S. Toll Free), +1 80 924 5906 (Israel), or +1-719-457-2689 (International). All dial-in participants must use the following code to access the call: 6114158.  

Please call at least five minutes before the scheduled start time.  The conference call will also be available via webcast, which can be accessed through http://public.viavid.com/index.php?id=120250 or the Investor Relations section of Attunity's website, http://www.attunity.com/investor-relations .  Please allow extra time prior to the call to visit the site and download any necessary software to listen to the live broadcast.

For interested individuals unable to join the conference call, a replay of the call will be available through August 17, 2016, at +1-877-870-5176 (U.S. Toll Free) or 1-858-384-5517 (International). Participants must use the following code to access the replay of the call: 6114158. The online archive of the webcast will be available on http://www.attunity.com/events for 30 days following the call.
 
About Attunity 
Attunity is a leading provider of Big Data management software solutions that enable access, management, sharing and distribution of data across heterogeneous enterprise platforms, organizations, and the  cloud . Our software solutions include  data replication and distribution test data management change data capture (CDC) data connectivity enterprise file replication  (EFR),  managed file transfer  (MFT),  data warehouse automation data usage analytics , and  cloud data delivery .
 
Attunity has supplied innovative software solutions to its enterprise-class customers for over 20 years and has successful deployments at thousands of organizations worldwide. Attunity provides software directly and indirectly through a number of partners such as Microsoft, Oracle, IBM and Hewlett Packard Enterprise. Headquartered in Boston, Attunity serves its customers via offices in North America, Europe, and Asia Pacific and through a network of local partners. For more information, visit http://www.attunity.com  or our blog  and join our community on Twitter , Facebook , LinkedIn , and  YouTube .
 
Use of Non-GAAP Financial Information
In addition to reporting financial results in accordance with U.S. generally accepted accounting principles, or GAAP, Attunity uses Non-GAAP measures of net income (loss), operating income (loss), and diluted net income (loss) per share, which are adjusted from results based on GAAP to exclude expenses, amortization and impairment charges associated with the acquisitions, stock-based compensation expenses in accordance with ASC 718, non-cash financial expenses such as the effect of a revaluation of liabilities presented at fair value and accretion of payment obligations, and tax benefits related to non-GAAP adjustments. Attunity’s management believes the non-GAAP financial information provided in this release is useful to investors' understanding and assessment of Attunity's on-going core operations and prospects for the future. Management uses both GAAP and non-GAAP information in evaluating and operating its business internally and as such has determined that it is important to provide this information to investors. The presentation of this non-GAAP financial information is not intended to be considered in isolation or as a substitute for results prepared in accordance with GAAP.  For further details, see the Reconciliation of Supplemental Non-GAAP Financial Information table later in this press release.
 

Safe Harbor Statement
This press release contains forward-looking statements, including statements regarding the anticipated features and benefits of Replicate Solutions, within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995 and other Federal Securities laws. Statements preceded by, followed by, or that otherwise include the words "believes", "expects", "anticipates", "intends", "estimates", "plans", and similar expressions or future or conditional verbs such as "will", "should", "would", "may" and "could" are generally forward-looking in nature and not historical facts. For example, when we say that we expect our growth to continue through the second half of the year and beyond or that our $4.5 million agreement highlights a growing market opportunity for Attunity with other large strategic and global agreements, we are using forward-looking statements. Because such statements deal with future events, they are subject to various risks and uncertainties and actual results, expressed or implied by such forward-looking statements, could differ materially from Attunity's current expectations. Factors that could cause or contribute to such differences include, but are not limited to, risks and uncertainties relating to: our history of operating losses and ability to achieve profitability; our reliance on strategic relationships with our distributors, OEM, VAR and "go-to-market" and other business partners, and on our other significant customers; our ability to manage our growth effectively; acquisitions, including costs and difficulties related to integration of acquired businesses [and impairment charges]; our ability to expand our business into the SAP market and the success of our Gold Client offering; timely availability and customer acceptance of Attunity's new and existing products, including Attunity Compose and Attunity Visibility; fluctuations in our quarterly operating results, which may not necessarily be indicative of future periods; changes in the competitive landscape, including new competitors or the impact of competitive pricing and products; a shift in demand for products such as Attunity's products; the impact on revenues of economic and political uncertainties and weaknesses in various regions of the world, including the commencement or escalation of hostilities or acts of terrorism as well as cyber-attacks; and other factors and risks on which Attunity may have little or no control. This list is intended to identify only certain of the principal factors that could cause actual results to differ. For a more detailed description of the risks and uncertainties affecting Attunity, reference is made to Attunity's latest Annual Report on Form 20-F which is on file with the Securities and Exchange Commission (SEC) and the other risk factors discussed from time to time by Attunity in reports filed with, or furnished to, the SEC. Except as otherwise required by law, Attunity undertakes no obligation to publicly release any revisions to these forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.
 
The contents of any website or hyperlinks mentioned in this press release are for informational purposes and the contents thereof are not part of this press release.
 
© 2016 Attunity Ltd. All rights reserved. Attunity is a trademark of Attunity Inc.
 
For more information, please contact:
Garth Russell / Allison Soss
KCSA Strategic Communications
P: + 1 212-682-6300
grussell@kcsa.com    /  asoss@kcsa.com   

Dror Harel-Elkayam, CFO
Attunity Ltd.
P: +972 9-899-3000
dror.elkayam@attunity.com


 
ATTUNITY LTD. AND SUBSIDIARIES
 
CONSOLIDATED FINANCIAL STATEMENTS
 
AS OF JUNE 30, 2016
 
UNAUDITED
 
U.S. DOLLARS IN THOUSANDS
 
INDEX
 
 
Page
   
2-3
   
4
   
5
   
6


ATTUNITY LTD. AND SUBSIDIARIES
 
CONDENSED CONSOLIDATED BALANCE SHEETS
U.S. dollars in thousands
 
   
June 30,
   
December 31,
 
   
2016
   
2015
 
   
Unaudited
       
ASSETS
           
             
CURRENT ASSETS:
           
Cash and cash equivalents
 
$
8,919
   
$
12,522
 
Trade receivables (net of allowance for doubtful accounts of $15 at June 30, 2016 and December 31, 2015)
   
6,920
     
4,524
 
Other accounts receivable and prepaid expenses
   
1,136
     
639
 
                 
Total current assets
 
$
16,975
   
$
17,685
 
                 
LONG-TERM ASSETS:
               
                 
Severance pay fund
 
$
3,706
   
$
3,513
 
Property and equipment, net
   
1,359
     
1,260
 
Goodwill and Intangible assets, net
   
36,676
     
40,116
 
Other assets
   
1,644
     
584
 
                 
Total long-term assets
   
43,385
     
45,473
 
                 
Total assets
 
$
60,360
   
$
63,158
 

 
2

ATTUNITY LTD. AND SUBSIDIARIES
 
CONDENSED CONSOLIDATED BALANCE SHEETS
U.S. dollars in thousands, except share and per share data
 
   
June 30,
   
December 31,
 
   
2016
   
2015
 
   
Unaudited
       
LIABILITIES AND SHAREHOLDERS' EQUITY
           
CURRENT LIABILITIES:
           
             
Trade payables
   
1,052
     
664
 
Payment obligation related to acquisitions
   
1,018
     
2,204
 
Deferred revenues
   
10,788
     
9,354
 
Employees and payroll accruals
   
4,662
     
4,012
 
Accrued expenses and other current liabilities
   
1,262
     
1,248
 
                 
Total current liabilities
 
$
18,782
   
$
17,482
 
                 
LONG-TERM LIABILITIES:
               
                 
Deferred revenues
   
1,016
     
1,348
 
Liabilities presented at fair value and other long-term liabilities
   
963
     
1,037
 
Payment obligation related to acquisition s
   
-
     
254
 
Accrued severance pay
   
5,050
     
4,746
 
Total long-term liabilities
 
$
7,029
   
$
7,385
 
                 
SHAREHOLDERS' EQUITY:
               
Share capital - Ordinary shares of NIS 0.4 par value -
   
1,899
     
1,876
 
Authorized: 32,500,000 shares at June 30, 2016 and December 31, 2015; Issued and outstanding: 16,631,754 shares at June 30, 2016 and 16,406,243 shares at December 31, 2015
               
Additional paid-in capital
   
147,470
     
144,836
 
Accumulated other comprehensive loss
   
(1,087
)
   
(1,137
)
Accumulated deficit
   
(113,733
)
   
(107,284
)
                 
Total shareholders' equity
   
34,549
     
38,291
 
                 
Total liabilities and shareholders' equity
 
$
60,360
   
$
63,158
 

3

ATTUNITY LTD. AND SUBSIDIARIES
 
CONSOLIDATED STATEMENTS OF OPERATIONS
U.S. dollars in thousands, except share and per share data
 
   
Three months ended
   
Six months ended
 
   
June 30,
   
June 30,
 
   
2016
   
2015
   
2016
   
2015
 
   
Unaudited
   
Unaudited
 
Software licenses
 
$
7,964
   
$
6,781
   
$
13,539
   
$
12,360
 
Maintenance and services
   
6,268
     
5,447
     
12,433
     
10,248
 
Total revenue
   
14,232
     
12,228
     
25,972
     
22,608
 
Operating expenses:
                               
Cost of revenues
   
2,321
     
2,005
     
4,379
     
3,243
 
Research and development
   
3,492
     
2,697
     
6,792
     
4,893
 
Sales and marketing
   
9,390
     
7,103
     
17,847
     
13,285
 
General and administrative
   
1,178
     
1,080
     
2,308
     
2,636
 
Impairment of acquisition-related intangible assets
   
2,132
     
-
     
2,132
     
-
 
Total operating expenses
   
18,513
     
12,885
     
33,458
     
24,057
 
Operating loss
   
(4,281
)
   
(657
)
   
(7,486
)
   
(1,449
)
Financial (income) expenses, net
   
(137
)
   
(14
)
   
(80
)
   
235
 
Loss before taxes on income
   
(4,144
)
   
(643
)
   
(7,406
)
   
(1,684
)
Taxes on income (benefit)
   
(1,283
)
   
155
     
(957
)
   
441
 
Net loss
 
$
(2,861
)
 
$
(798
)
 
$
(6,449
)
 
$
(2,125
)
 
                               
Basic and diluted net loss per share
 
$
(0.17
)
 
$
(0.05
)
 
$
(0.39
)
 
$
(0.13
)
                                 
Weighted average number of shares used in computing basic and diluted net loss per share
   
16,737
     
16,290
     
16,671
     
15,900
 

4

ATTUNITY LTD. AND SUBSIDIARIES
 
CONSOLIDATED STATEMENTS OF CASH FLOWS
U.S. dollars in thousands
 
   
Six months ended June 30,
 
 
 
2016
   
2015
 
 
 
Unaudited
 
Cash flows activities:
           
Net loss
 
$
(6,4 49
)
 
$
(2,125
)
Adjustments required to reconcile net loss to net cash provided by (used in) operating activities:
               
Depreciation
   
237
     
193
 
Stock based compensation
   
2,220
     
971
 
Amortization of intangible assets
   
1,393
     
1,285
 
Impairment of acquisition-related intangible assets
   
2,132
     
-
 
Accretion of payment obligations
   
(12
)
   
130
 
Change in:
               
   Accrued severance pay, net
   
111
     
163
 
   Trade receivables
   
(2,714
)
   
1,390
 
   Other accounts receivable and prepaid expenses
   
(491
)
   
(972
)
   Other long term assets and liabilities
   
179
     
(12
)
   Trade payables
   
397
     
355
 
   Deferred revenues
   
1,262
     
2,225
 
   Employees and payroll accruals
   
840
     
421
 
   Accrued expenses and other liabilities
   
49
     
(339
)
Change in liabilities presented at fair value and other long-term liabilities
   
(86
)
   
40
 
Tax benefits related to exercise of stock options
   
44
     
(60
)
Change in deferred taxes, net
   
(1,196
)
   
195
 
Net cash provided by (used in) operating activities
   
(2,084
)
   
3,860
 
Cash flows from investing activities:
               
Purchase of property and equipment
   
(340
)
   
(283
)
Acquisition of company, net of cash acquired
   
-
     
(10,402
)
Net cash used in investing activities
   
(340
)
   
(10,685
)
Cash flows from financing activities:
               
Proceeds from exercise of stock options, warrants and rights
   
155
     
696
 
Tax benefits related to exercise of stock options
   
(44
)
   
60
 
Payment of contingent consideration
   
(1,239
)
   
(2,054
)
Net cash used in financing activities
   
(1,128
)
   
(1,298
)
Foreign currency translation adjustments on cash and cash equivalents
   
(51
)
   
2
 
Decrease in cash and cash equivalents
   
(3,603
)
   
(8,121
)
Cash and cash equivalents at the beginning of the period
   
12,522
     
18,959
 
Cash and cash equivalents at the end of the period
   
8,919
     
10,838
 
                 
Supplemental disclosure of cash flow activities:
               
Cash paid during the period for taxes
 
$
563
   
$
1,028
 
                 
Supplemental disclosure of non-cash investing activities:
               
Issuance of shares related to acquisitions
   
224
     
6,600
 

5

 
ATTUNITY LTD. AND ITS SUBSIDIARIES
 
RECONCILIATION OF SUPPLEMENTAL NON-GAAP FINANCIAL INFORMATION

U.S. dol la rs in thousands, except share and per share data
 
   
Three months ended June 30,
   
Six months ended June 30,
 
   
2016
   
2015
   
2016
   
2015
 
   
Unaudited
   
Unaudited
 
GAAP revenues
   
14,232
     
12,228
     
25,972
     
22,608
 
Valuation adjustment on acquired deferred service revenue
   
9
     
310
     
26
     
345
 
Non-GAAP revenues
   
14,241
     
12,538
     
25,998
     
22,953
 
                                 
GAAP cost of revenue
   
2,321
     
2,005
     
4,379
     
3,243
 
Amortization of acquired intangible assets
   
634
     
684
     
1,267
     
1,127
 
Cost of revenue adjustment (1)
   
40
             
80
         
Non-GAAP cost of revenue
   
1,647
     
1,321
     
3,032
     
2,116
 
                                 
GAAP gross profit
   
11,911
     
10,223
     
21,593
     
19,365
 
Gross profit adjustments
   
683
     
994
     
1,373
     
1,472
 
Non-GAAP gross profit
   
12,594
     
11,217
     
22,966
     
20,837
 
                                 
GAAP operating expenses
   
18,513
     
12,885
     
33,458
     
24,057
 
Cost of revenues (1)
   
40
     
-
     
80
     
-
 
Research and development (1) (2)
   
317
     
235
     
679
     
335
 
Sales and marketing (1) (2)
   
691
     
593
     
1,458
     
788
 
General and administrative (1) (2)
   
233
     
153
     
484
     
865
 
Amortization of acquired intangible assets
   
696
     
783
     
1,393
     
1,285
 
Impairment of acquisition-related intangible assets
   
2,132
     
-
     
2,132
     
-
 
Non-GAAP operating expenses
   
14,404
     
11,121
     
27,232
     
20,784
 
                                 
GAAP Financial (income) expenses, net
   
(137
)
   
(14
)
   
(80
)
   
235
 
Revaluation of liabilities presented at fair value
   
61
     
77
     
(86
)
   
59
 
Accretion of payment obligations
   
(36
)
   
80
     
(12
)
   
130
 
Non-GAAP Financial (income) expenses, net
   
(162
)
   
(171
)
   
18
     
46
 
                                 
GAAP taxes on income (benefit)
   
(1,283
)
   
155
     
(957
)
   
441
 
Tax benefits related to non-GAAP adjustments
   
(1,148
)
   
(334
)
   
(1,314
)
   
(383
)
Non-GAAP taxes on income (benefit)
   
(135
)
   
489
     
357
     
824
 
                                 
GAAP net loss
   
(2,861
)
   
(798
)
   
(6,449
)
   
(2,125
)
Valuation adjustment on acquired deferred revenue
   
9
     
310
     
26
     
345
 
Amortization of acquired intangible assets
   
696
     
783
     
1,393
     
1,285
 
Impairment of acquisition-related intangible assets
   
2,132
     
-
     
2,132
     
-
 
Acquisition related expenses
   
344
     
456
     
779
     
1,017
 
Stock-based compensation
   
937
     
525
     
1,922
     
971
 
Revaluation of liabilities presented at fair value
   
61
     
77
     
(86
)
   
59
 
Accretion of payment obligations
   
(36
)
   
80
     
(12
)
   
130
 
Tax benefits related to non-GAAP adjustments
   
(1,148
)
   
(334
)
   
(1,314
)
   
(383
)
Non-GAAP net income (loss)
   
134
     
1,099
     
(1,609
)
   
1,299
 
                                 
GAAP diluted net loss per share
   
(0.17
)
   
(0.05
)
   
(0.39
)
   
(0.13
)
Non-GAAP diluted net income (loss) per share
   
0.01
     
0.06
     
(0.10
)
   
(0.08
)
                                 
shares used in computing GAAP diluted net income (loss) per share
   
16,737
     
16,290
     
16,671
     
15,900
 
                                 
shares used in computing Non-GAAP diluted net income (loss) per share
   
17,016
     
17,029
     
16,671
     
16,602
 

6

ATTUNITY LTD. AND ITS SUBSIDIARIES
 
RECONCILIATION OF SUPPLEMENTAL NON-GAAP FINANCIAL INFORMATION
U.S. dol la rs in thousands, except share and per share data
 
   
Three months ended June 30,
   
Six months ended June 30,
 
 
2016
   
2015
   
2016
   
2015
 
(1) Stock-based compensation expenses (*):
                               
Cost of revenues
   
40
     
-
     
80
     
-
 
Research and development
   
231
     
121
     
493
     
221
 
Sales and marketing
   
433
     
251
     
865
     
446
 
General and administrative
   
233
     
153
     
484
     
304
 
     
937
     
525
     
1,922
     
971
 
(*) Retention bonus paid in Attunity shares constitute part of (2) below
                 
                                 
(2) Acquisition related expenses
                               
Research and development
   
86
     
114
     
186
     
114
 
Sales and marketing
   
258
     
342
     
593
     
342
 
General and administrative
   
-
     
-
     
-
     
561
 
     
344
     
456
     
779
     
1,017
 
 
7